Probably the most appropriate thing, I imagine, would be geological and geographical circumstances, because often those can contribute even to political institutions. In the Three Kingdoms era of China, for instance, the population produced the state civilian granary as a result of necessity, as famine was prevalent throughout the kingdoms. This was in turn linked to Confucianism, as Confucius taught that the granary was a prime example of the community coming together-- with the blessing of its leaders-- to guide itself. And Confucianism in turn obviously gave rise to many tenets of Chinese government and culture. This is essentially why I'd choose geological circumstance as the prime factor in cultural differentiation.

Different cultural reputations for individual states are important to the game, as we see not just differences in social, economic, and political factions within each state, but technological evolution as well. In a game, the same rules usually apply across the board to all players involved, but history tells us in real life this is not so. A geographical example would be the Native-American Indians encountered by Christopher Columbus. Although their descendants had been in the Americas for at least 14,000 years, they were at a distinct technical disadvantage because of their isolation from other community's (i.e. Europeans had far superior weaponry, resources, etc.)